Battle lines drawn as Rebosis saga drags on 

The battle between businessman Zunaid Moti and Rebosis CEO Sisa Ngebulana continues, with two affidavits regarding the North Gauteng High Court matter now in the public domain. 

Moti said in December last year he was owed R125 million by Ngebulana’s Amatolo Family Trust.

The Trust owns Rebosis shares worth 5.8%. Moti purchased his millions in Rebosis shares in August 2020, and planned a turnaround plan for the company’s R10 billion debt. 

The chairman of Nedbank wrote to meet Moti to discuss his financial turnaround plans, as long as Rebosis management facilitated this meeting. It was then that Ngebulana bought Moti out, without paying for his shares. 

It was agreed that Billion Group, of which the Amatolo Trust is the 100% shareholder, would pay Moti Group entity Ammetti Holdings a structuring fee of R17 million to conclude the transaction. 

This payment never took place, with conversations between Moti and Ngebulana revealing that Ngebulana was not able to make the payment, which Moti deemed an act of insolvency by the Amatolo Trust. 

In Ngebulana’s answering affidavit in February, Ngebulana claimed he did not have the trustees’ authority to sign the share purchase agreement to buy the shares from Moti.

ALSO READ: Rebosis Property Fund to sell R6bn in office properties in face of ‘perfect storm’

He said that without the agreement and signatures of the other three Amatolo Family Trust trustees, the share purchase agreement would be null and void, and that Moti could take back his shares. 

Ngebulana’s affidavit claims that the controversial nature of Moti as a businessman created uneasiness among Rebosis management and finances, which Ngebulana said prompted him to negotiate purchasing Moti’s shares, and ensuring that Moti never purchases Rebosis shares again. 

However, Ngebulana said two of the four trustees of the Trust said last year they would only approve the transaction if he could obtain financing. An oral agreement between Moti and Ngebulana then ensued, which Moti said he understood, Ngebulana said. 

He said he was “fairly confident” in the Trust approving the transaction, and that they would be able to get financing. But Covid-19 “reduced appetite for financing large transactions”.

As such, Ngebulana was unable to obtain the relevant finances to purchase Moti’s Rebosis shares. 

Moti, however, dubbed Ngebulana’s affidavit’s facts “false” and “far-fetched”. 

Moti said there was never a resolution for the Trust to purchase his Rebosis shares, and that Ngebulana’s entire defence “hinged on an alleged absent resolution”.

Ngebulana was also accused of writing to the Central Securities Depository (CSDP) that he owned Moti’s shares, and asked for voting rights of the shares at the Rebosis annual general meeting, due to take place on Tuesday. 

The CSDP responded by saying that Ngebulana’s assertions about the shares were wrong, and contrary to a written agreement of cession and pledge of shares. 

Moti wrote to Ngebulana asking to meet on Monday, ahead of the Rebosis AGM, to settle the matter and to alleviate uncertainty for shareholders. 

However, Moti said no response was received yet. 

Moti’s voting rights were granted for the upcoming Rebosis AGM. 

The Amatolo Family Trust recently published a statement noting “disappointment” in the release of the affidavits, due to the matter currently being sub judice. 

ALSO READ: Covid-19: Major mall owners hammered on the JSE

They said Moti’s affidavit depicted the matter as being “one-sided”, adding that disputes between debtors and creditors are “generally resolved between the parties.”

They committed to filing opposing papers and counterclaims “in due course”. 

Rebosis’ embattled finances 

Rebuses Property Fund, a JSE-listed Real Estate Investment Trust, has been trading at below R1 since February last year, largely due to its own internal debt levels. 

In March, it was reported that Rebosis lost 72.5% to 22 cents a share. 

The South African listed property sector lost over 50% of its value in 2020, with Stanlib head of listed property funds Keillen Ndlovu telling Moneyweb last year that this is the worst performance in the sector ever recorded, and warned that distribution growth will remain negative over the next year. 

But Rebosis’s financial drama began long before the Covid-19 pandemic. 

In 2018, Rebosis saw a 27.7% decline for its ordinary B share. Distributable income dropped to just over R790 million, down from R973.6 million in 2017. 

In light of this, Ngebulana sought to sell R6 billion in office property assets, dubbing 2018 “a perfect storm” for Rebosis. It cited being affected by the UK’s decision to exit the European Union in its Brexit move. 

Rebois was invested in UK-based New Frontier Properties, owning a 49.3% stake. No dividend was paid by New Frontier in 2018, bringing the company’s debt and loan-to-value (LTV) ratio to below 40%. 

Unfortunately, the years that followed 2018 did not yield the turnaround performance sought by Rebosis. 

Compiled by Nica Richards 

For more news your way, download The Citizen’s app for iOS and Android.